Help Centre

Hochtief needs 10% in a hurry

German suitor has just one week to boost Leighton stake beyond 70 per cent.

Germany's Hochtief has just one week left to boost its stake in Leighton Holdings beyond 70 per cent as part of its $1.2 billion proportional takeover offer for the Australian construction giant, which closes next Friday.

The German company, controlled by Spain’s ACS group, has aspirations to secure as much as 73.82 per cent of Leighton as part of a proportional bid announced in March, when it already owned close to 59 per cent of the company.

Yesterday, Leighton filed a substantial shareholding notice showing Hochtief so far has only 61.09 per cent of its target.

The offer closes on May 9, meaning Hochtief would need to secure a further 10 per cent in Leighton over seven business days to achieve its desired holding of at least 70 per cent as part of the offer.

On Tuesday, Hochtief accelerated the time it would take to pay investors that bought into the offer to seven days.

Previously, the earliest people could have got paid was May 12, one month after the deal went unconditional on April 11.

But on Tuesday, under the accelerated payment terms, shareholders could receive the money seven business days from then.

One institutional investor with a small stake spoken to by The Australian yesterday said they were yet to decide on whether to accept Hochtief’s offer, but were likely to do so.

Leighton’s new chief executive, Marcelino Fernandez, is expected to reveal some of the plans he has for the company at its annual meeting on Monday.

Hochtief’s conditional proportional offer is $22.50 for three out of every eight shares that investors owned, equating to 37.5 per cent of their interests.

The company did not want to buy more than 73.82 per cent because to do so would trigger changes in Leighton’s debt arrangements, which could be costly for Hochtief.

Shares in Leighton last night closed below the offer price, down 22c to $19.08.

IMPORTANT: This information has been prepared without taking into account your objectives, financial situation or needs and you should consider if the information is appropriate for you before making an investment decision. Unless otherwise specifically stated or disclosed (such as the InvestSMART Diversified Portfolios Product Disclosure Statement), neither InvestSMART Financial Services Pty Ltd nor any of its Related Companies make any recommendations as to the merits of any investment opportunity referred to in its emails or its related websites. Product disclosure statements for financial products offered through InvestSMART can be downloaded from this website or obtained by contacting 1300 880 160. You should consider the product disclosure statement before making a decision about the product. All indications of performance returns are historical and can not be relied upon as an indicator for future performance.